Republican Tax Plan Horror Story - NetFlix +$845 millon profit / $0 taxes / $22 million tax rebate!

[PeeJ52]

Plus the service’s most popular plan will increase from $11 to $13 per month for HD streaming. Netflix’s most expensive plan, which offers 4K content and up to four simultaneous streams on different devices, will increase from $14 to $16. And the service’s basic plan, which doesn’t offer HD, will raise from $8 to $9.

This is amazing!!!

Read it from 2 sources if you like...

https://www.dailykos.com/stories/2019/2/8/1833347/-Netflix-made-a-record-845-million-paid-ZERO-in-taxes-and-reported-a-22-million-rebate

https://www.breitbart.com/entertainment/2019/02/08/netflix-paid-zero-in-taxes-on-record-845m-profits-in-2018/

[Dennis Donovan]

1. I dropped Netflix because of their price hikes...

...and because I realized I didn't watch it much at all, anyway. YouTube Red and Amazon prime are much better values than overpriced Netflix.

[ooky]

9. Me too.

I was finding more interesting stuff to watch on Amazon Prime. So I gave Netflix the hook. And now that I've seen this I'm in no hurry to go back.

[PeeJ52]

11. Yeah.. I did too... I watch Prime just because I pay for the free shipping.

I actually watch more free movies on Tubi.tv or Crackle or some of the other free places on the Internet. Plus I use an antenna for my TV instead of cable...

[Dennis Donovan]

12. I'm a cord cutter with 8 messy mips...

...so it was (and still is) a challenge. But, FIOS is going to be run into my retirement community shortly, so I'm returning from Mars shortly.

[PeeJ52]

15. Wow... Impressive...

I'm thinking of moving to Prince Edward Island where I'll only be able to get DSL, so at least you give me hope...

[dalton99a]

2. Spread this far and wide

[Initech]

3. And their CEO gets a nice big fat 8 figure paycheck.

While the workers who made it happen get screwed. Ain't trickle down economics great?

[Me.]

4. How Do You Get A Rebate If You Haven't Paid Anything?

[PeeJ52]

5. Tax Credits

Like if they hire so many handicapped people they might get a federal tax credit for that where the government actually pays them money. That's the corporate welfare.

[fescuerescue]

7. carry-forward losses

They weren't born profitable.

[fescuerescue]

6. Netlflix lost money for years.

Hundreds of millions.

It's a profitable company now, but they are utilizing their loss cary-forward to offset taxes now that they have turned the corner. They'll do this for awhile. Until they can't (which should be relatively soon)

Is that good tax policy? Maybe. Maybe not. But I support the ability for a company to take chances and invest in people and equipment during the early years, and carry-forward losses (which are finite) allow them to do this.

Would Netflix exist if they couldn't write off prior year losses? Good chance of it, but not certain. On the other hand, maybe they would not have hired so many people, and invested so much (during the Obama years mind you), if they knew that carry-forward would not be permitted.

[safeinOhio]

8. I have a tiny business

And never got to carry forward.

[fescuerescue]

13. Depends on the tax structure

https://bizfluent.com/info-12022585-can-schedule-c-losses-carried-forward.html

Most small business don't require the capital investment that Netflix did and it rarely makes sense for a small business to organize as a C corp.

But if you DO need millions invested, and need venture-capital, C corp is the about the only way to go. This describes most of the Silicon valley type success stories we know about, and enable us to complain about here on social media.

[safeinOhio]

22. Is that what brought us the

Dot.com bust?

[fescuerescue]

23. over excitement brought us the .com bust

I was at ground zero during all that. I have the scars, plus a ch.7 to prove it

The hype and expectations over what the Internet will bring us was at full boil and steam rolling into 2001. When the world realized that everything that was to come wasn't coming immediately, things began to cool and it looking like GWB was going to win the election (and he did), things did cool and everyone panicked. Then 9/11 happened.

Funny thing is, pretty much everything that was promised from the Internet did come to pass. It just took about 15 years longer than people wanted it to.

On balance, the (BOOM - the bust), along with the Moon Landing in 1969 is probably two best things that the US brought to the world in the last 100 years. Was the Internet boom worth the Internet bust? Absolfuckinglootely.

Without the Internet, you and I wouldn't be having this conversation.

[PeeJ52]

14. but who lost the money?

It looks like 2003 was when they started turning a profit. Surely they would be finished with their carry forward on losses from then... Naw... It's just more of Corporate Socialism...

[fescuerescue]

16. What tax cut are they utilizing then?

Carry forward losses are good for 20 years btw.

But it's a serious question, if it's not carry-forward losses. What tax law are they abusing?

[Igel]

24. Another poster pointed out that there are

two accounting schemes used, and they differ in how you treat depreciation.

Since one is for taxes is used consistently that way, that's one number. And it's valid.

The other is used for corporate reports. It's used consistently that way, and that's a second number. And it's valid.

The org I was with in the '90s had used some sort of cash accounting and then switched over to GAAP. Those who had been reading the reports for years were horrified at the new reports. In spite of the fact that little had changed. It was a question of figuring out what the numbers meant in a given context, where the liabilities were, were the assets were, and how things were being moved around. Took old-timers a few months to come to grips.

What old timers really had trouble with was reconciling the current scheme with past year's numbers. So somebody had to go back and redo a lot of the reports for the previous few years to make the historical trendlines reasonable.

[csziggy]

21. Thank Ross Perot for the carry-back/carry-forward losses

He got those put into the tax system so he could carry back losses on EDS**.

My husband and I got to use the carry-back loss scheme back in the 1980s when we closed two businesses. Although the businesses were by then barely making profits, if we closed them then and used carry-back losses we'd get a nice fat check from the IRS which when put into investments earned more than the businesses were estimated to do. No brainer, there.

These kind of tax schemes do allow companies to invest more with the idea that once they make a profit they can write off past years losses against their more successful years. They also let cyclical businesses keep running. For instance, when I bred horses, I would have years when sales were not good and then in a good year I would sell not only foals from previous years, foals from that year would sell at higher prices. I could not have kept my horse business going without off setting those profits against the years when no horses sold.

**And of course we can't mention EDS without watching one of the best commercials of all times:

[superpatriotman]

10. But Bird Box!

Think of all the jobs NFLX has cost the entertainment delivery business, too.

[fescuerescue]

17. Yea. I miss all the Blockbuster late fees

given by high school kids.

[joc46224]

18. Breitbart comments--OMG

I've never gone to Breitbart until today. I saw your link and thought "Wait, Dailykos and Breitbart are in agreement on something?". Then I saw all the comments on Breitbart. It's Obama's fault. Apparently since Obama joined the Netflix Board (which I didn't realize) he was (somehow) able to pass laws that allowed Netflix these tax loopholes. Oh, and that Obama is sure super sneaky about it because Netflix paid taxes when he was President...he must have done that to throw people off the trail later on. Oh, and Susan Rice joining the Netflix Board is also a big reason for Netflix not paying taxes. Seriously, how dumb can you get?

[PeeJ52]

20. LOL... I couldn't bring myself to stay on long enough to read the comments...

I felt dirty enough just visiting to see KOS and Breitbart agreed...

[Power 2 the People]

19. And the beat goes on.

[Duppers]

25. Will never click breibart.

Besides DK, here's another link:

https://www.dailymail.co.uk/news/article-6678703/Netflix-didnt-pay-dime-state-federal-income-taxes-year-got-22m-REBATE.html